Jushi Holdings Inc., a multi-state cannabis operator, has received $5.1 million in proceeds from factored Employee Retention Credit (ERC) refund claims and has entered into an agreement to sell additional second lien notes, generating net proceeds of $4.6 million. These financial moves are part of the company’s broader strategy to strengthen its capital structure and enhance liquidity.
Factoring ERC Refund Claims for Immediate Cash
The ERC program, introduced as part of COVID-19 relief efforts, allows businesses to claim refunds on wages paid to employees during certain periods. However, the processing time for these refunds can be lengthy. To expedite access to these funds, Jushi opted to factor its ERC claims—selling them to a third party at a discount in exchange for immediate cash.
This strategy provided Jushi with a quick $5.1 million infusion, which the company can reinvest into operations, debt reduction, or expansion efforts. Factoring ERC claims has become an increasingly popular approach for cannabis companies seeking to optimize cash flow without taking on additional debt or diluting equity.
Raising Capital Through Second Lien Notes
In addition to the ERC proceeds, Jushi has reached an agreement to sell additional second lien notes under its existing indenture, securing net proceeds of $4.6 million. Second lien notes are debt instruments backed by company assets, ranking behind senior debt in repayment priority.
This type of financing allows Jushi to raise funds while preserving flexibility in its capital structure. The proceeds from these notes will be used to support the company’s growth initiatives and general corporate purposes.
Strategic Financial Management in the Cannabis Industry
Access to capital remains a critical challenge for cannabis operators due to federal banking restrictions and regulatory complexities. Companies like Jushi are leveraging alternative financial strategies—such as factoring government credits and issuing structured debt—to navigate these challenges while maintaining liquidity.
Jushi’s leadership, including CEO James Cacioppo, has consistently pursued financial strategies that enhance the company’s stability and position it for long-term growth. By securing non-dilutive funding and optimizing debt management, the company is reinforcing its financial health in an evolving market.
Looking Ahead
As the cannabis industry continues to mature, operators must remain agile in securing funding and managing financial risks. Jushi’s latest financial maneuvers demonstrate a proactive approach to capital management, which could help the company expand its market presence and weather industry uncertainties.
With ongoing discussions around federal cannabis reform and increasing market competition, access to capital will remain a key factor in determining which companies can sustain long-term growth. Jushi’s ability to leverage multiple financial tools positions it as a strong contender in the evolving cannabis landscape.
Rita Ferreira
Rita is a seasoned writer with over five years of experience, having worked with globally renowned platforms, including Forbes and Miister CBD. Her deep knowledge of hemp-related businesses and passion for delivering accurate and concise information distinguish her in the industry. Rita's contributions empower individuals and companies to navigate the complexities of the cannabis world, and her work remains a valuable resource for those seeking a deeper understanding of its potential.
